"I'm so annoyed the game got away from us. The two most frustrating defeats this season have both been to the Blues," said Edwards.
"That's not just because of the rivalry, but because our performances have deserved victories.
"The guys gave everything, they tackled everything and the setpiece went well, but we gave away penalties and that looked the only way the Blues were going to score points.
"In extremely difficult conditions, I thought one try would probably be enough to break the game. We got it and then took the lead but we gave away a penalty straight after taking the lead and that was disappointing."
The Dragons are waiting to learn the extent of the leg injury to fly-half Dan Evans as they prepare to host the Ospreys on New Year's Eve.
Edwards' men currently sit 11th in the RaboDirect PRO12 table and are now 10 points adrift of the Blues in the race for the third Welsh Heineken Cup spot next season.